Why Connecticut cannot afford to raise taxes

By State Rep. DebraLee Hovey

Published 6:39 pm, Monday, August 31, 2009

In the ongoing budget debate, Majority Democrats in the General Assembly have proposed massive tax increases to bridge a budget deficit caused by the national economic downturn. Those increases are broad and deep, amounting to $1.8 billion in business and income tax hikes without any meaningful spending reductions.

To justify the single largest tax increase in state history, my friends on the other side of the aisle have trotted out a slogan that sounds attractive enough to anyone who has been impacted by the recession. They argue that tax increases are acceptable because they fall on wealthier residents and business owners, forcing them to "pay their fair share." At a time when middle class families are feeling unprecedented pain, the slogan at first blush doesn't sound so bad.

As to the negative impact of higher taxes on our economy, proponents deny such collateral damage will occur. They argue that wealthy residents and employers who contribute billions to our tax rolls and sign the paychecks of Connecticut workers will simply stay here and take it, and that there is no historical evidence to suggest otherwise.

They are wrong.

The Democrats are entitled to their own opinion, but not their own facts. Connecticut's economic history over the last two decades tells us that now is precisely the wrong time to raise taxes on those to whom we are looking to create jobs for the unemployed and lift us from this recession.

Let's consider the facts:

Connecticut's job growth ranks dead last in the nation, in part because we are ranked as among the least business friendly states in America. In the last two years alone, 26,000 businesses have shut their doors and laid off their workers. The University of Connecticut projects that by the end of this recession, 110,000 of our friends and neighbors could find themselves unemployed.

As to the wealthy individuals who will be on the hook for this tax increase, we know they will leave because they have been leaving for years. From 2006 to 2007 alone, Connecticut has lost $3.2 billion in tax revenue because those with the means to do so have fled. If the Democrats' rationale is to raise taxes in order to pay for services to help the less fortunate, think of how many people could be helped had we been able to keep that $3.2 billion in revenue here in Connecticut.

The state's high tax burden has made Connecticut a place that too many have deemed a nice place to visit but not to stay. This trend must be stop if our economy has any hope of recovery. Like it or not, businesses and people of means provide employment to workers, and the vast majority of tax revenues to state government. If they leave, so do the jobs and tax dollars.

The insanity of the Democrats' tax proposal is compounded by their insistence that the budget cannot be cut in any significant way. This is, frankly, offensive to everyone who has had to scale their own budget back in this recession. It is the height of arrogance that those elected to serve the taxpayers, and those paid by the taxpayers, refuse to make the same sacrifices that everyone else has made.

State government's payroll is too big. No, I am not talking about police and firefighters and teachers, but rather the bureaucrats and political patronage jobs that cost taxpayers far too much in the form of salaries and benefits. It is unacceptable that the private sector has added no additional jobs to our economy since 1989, yet state government continually adds to its payroll. A government that is creating more jobs than the private economy is simply not sustainable for taxpayers.

We must do more with less.

Government does have a responsibility to help the less fortunate in our society. Yet even if we were to roll back discretionary spending to 2007 levels, as my Republican colleagues and I have advocated, we would still be offering a set of social services and education funding most considered generous two years ago. In so doing, we could balance our budget, provide for the needy and avoid taxing more jobs out of state.

As a state representative, I have no more important responsibility than working to ensure that Connecticut's economic recovery comes quickly and results in the gainful employment of all those who are currently seeking a job. That is why I cannot in good conscience support an irresponsible budget proposal that taxes those who create jobs and spends money that does not exist. To do so would further stunt Connecticut's economy and prolong the pain we all currently feel.

Our economic problems cannot be solved by a slogan, no matter how catchy.

State Representative DebraLee Hovey (R-112th) represents Monroe and Newtown in the General Assembly.